. >> meeting will come to order. role call please. president torres, vice president courtney commissioner moran here and commissioners are on their way. approval of minutes item number three gentlemen have you have you had a time to look at the minutes. i have two items. as

well as -- my lex if we could just check the names of the public speakers? thank you? . >> for which i am. >> student: gentlemen comment? general public comment, thank you all right anything else? . >> is there a motion, so moved. >> moved by commissioner court eand seconded by commissioner moran and all in favor signify by saying aye. aye. >> motion is carried. public comment? mr. allen? welcome. >> hi good afternoon commissioners i have a few questions that i would like to ask, the first question is to the chair through the city attorney at the december 11 commission meet commission torres asked us to report back to see if p uc can used the two

millions million dollars in park bound money allocated to lake -- last june an e-mail was sent to the city attorney asking if that opinion has been given and so far he has not received a response. to get an answer from the city attorney from this very important issue. for your information, commissioners, at the january 8 meeting of the park recreation and open space advisory committee, reckon park gave a 20 minute progresses report on capital planning for the year 2013. lake -- was not mentioned. reckon's park answer to my question about of the status of 2 million-dollar park bound money for lake merced, was that the park will not get around to looking at lake

merced until sometime in august of this year eight months from now question for mr. kelly this is on the advance coco calendar you indicated that a commission workshop on lake merced would be held in about two months and didn't see any mention yet on the events calendar and so we hope that you will be taking that up higher courtly so that we can get our calendars sing criterion niced with your calendar because we want we would not want to miss that. >> thank you very much. well we are working on that schedule madame attorney do you shave a response to that question. >> i do not want to get into a legal analysis. and the votessers authorized the bond fund the money is clearly eligible to be used at lake

merced there is nothing in the bond ordinance about the administration because that is within the per view of the mayor who's the achieve executive officer of the city. before any of those funds can be spent, they will have to be sequel analysis an action by the board that would be mayor through the controllers office for appropriation so essentially it's within the city family as to how those funds get administrator and had implemented. it's not predetermined. >> all right any other public comments before we move on? all right communication i think we know is there is there any input on communes commissioner? no? public comment. public communications? so no communications on the communications all right. other commission business? all right. then we come to what we have all been waiting for.

board is adjourned now -- [laughter] well first of all, i want to give you an up date that i had an opportunity to join the mayor at the u.s. conference of mayors where he and i did a presentation about infrastructure and it was definitely well received and i think that we will be getting a lot of calls about the work that we have been doing and so, as an opportunity to share knowledge amongst other mayors. the other thing that i would like to well -- let's start with the waste water. todd? good afternoon today reach todd rydstrom. very quickly for you what this means is whether or not of saves about two and-a-half million dollars a year for the next 13 years for

our rate pairs specifically on the overhead rate pierce have saved $3 million with this refundings and it was a successful sell. we had so much demand for our bonds we had thripel the demand for our bonds because of the respective name for the enterprise and p pc and the bond molders loaned us money at 1.2% interest requireflation is around three%. and so that meant that pairs have saved a total of $3 million and we will next sell bonds in the middle of february. so thank you. >> any questions? 3 million right? 333 million right? i 33 million right? i want to make sure that we have it out there. >> so the next one is the

jewelry labonte. >> good answering today you will hear about the dam project and so i want to use my recent up date to share with you some good news on other projects on january 11th we reach one of the most significant milestones probably on the program with the whole crew of the bay tunnel. where obviously, very proud of that achievement and i just have a few photo that is i wanted to share with you so if he could connect -- yeah. so this is the receiving shaft in hey ward and i'm just realizing that they are in a different order but that is fine. we use a different hold-through method where there is a box in the receiving shaft in which the tunnel boring machine had to perfectly line up with and you can think of it as

the shuttle docking on the space stags, accept for the fact that the p b m operator is actually blind while he is doing so. so with that done now, we have a little bit more work to do in shaft before we can start extracting the machine so what we are focusing on now, from upin the sky, so what we are doing now is we are focusing on removing all systems, utility lines, conveyor belt that is inside the tunnels that we can start laying the final lining for the item and that will begin sometime in april. also, i wanted to mention that in recent weeks we have completed the tie in between the bay division system that is the five division pipeline with the new irving ton

tunnel this is sensitive work and it has been done and another important mile sewn and we have beneficial use of the crystal spring pipeline number two and the only remaining work there is minor restoration and this is additional pipeline that makes our regional system more seismically reliable. and also mentioning is the sonoma valley water treatment plants, activities there are fast approaching completion, we have started testing some of the improvements built as part of this project and we are expecting substantial completion by april. and finally, i wanted to mention that the recent management team is taking a program wide review of all our active project both from a construction site and all of the soft costs with the objective of identifying cost efficiencyses that will help cover any

projected increases on the cal cal calaveras as well as other project and that will come with a revised budget that we will present for you for your approval sometime in april. >> thank you yeses? comments? that concludes my report. >> any public comment on the report of the general manager? no public comment opts the report of the general manager then we will proceed to the consent calendar any items. >> excuse me mr. president with item eight?. >> right that is right item number eight. almost forgot about you not to worry. >> thank you very much mr. president members of the commission. our chancing with bawsca i have a few items to report first of all, on the heals of your bonding success we are about to have bonding

success we have received a double a minus rating on our bonds -- thank you next week i'll fly too new york and talk to loan buyers and ring the bell and we anticipate the save's very much the along the same line as yours thank you for your support and your staff support on that item. wet a meeting last thursday night the new chair of our board is ireneconel and the new vice chair is rando from city of bris obtain and they do city work with the city of bris obtain as well and we have a board policy committee it's our one standing committee and there will be new members appointment to that i suspect and some carry over with respect to our board meeting we had two items of interest one related

to item 11 on calaveras dam and the other one is on the agreement and i'll withhold my comment until we get to that. >> we are ready to move to the public items? or consent calendars any consent items that you wish to remove. item nine, items nine f through eight are considered to be routine 50 the s f public utilities tigs and will be act upon by the single vote of theition and there will be no separate discussion of these at some times unless a member of commission or the public so requests and in which event the the matter will be removed from the car car and considered as a separate item. >> i'll lick had move -- all

those in favor signify by saying aye motion carries commissioner? >> i think we received some communication suggest that the item was improper and that it didn't reflects accurately the state of completion the new office building that is not how i read it but i just want to given that, that suggestion was on the record i want to be begin an at some point to clear the record on what the status of that is. >> yeah, i saw the e-mail inquiring about the recause and there is a phrase in there explaining the reason that the commission is being asked to extent the contract by 120 days because it refers to final acceptness of the project the reason for the 120 day extension is to finish the punchless in order to get the acceptance from

the general manager but the commissioner is not accepting the project as complete and looking at it, i didn't think it was necessary to ask you to revise the resolution because it's clear that you are only resolve to go extend the time, but i understand how that ambiguity a rose so thank you for the chance to clarify that. >> that is how i read it as well but i wanted to make sure that the record is clear with that clarification i would like to move item nine b. moved and seconded the item movements forward any questions from the commission. >> with respect to the contract terms, do any of those have to do with the actual construction? are we reverse engineering the construction assignments or is there anything relate today say for example renewable energy of the facility or? >> i don't believe so.

okay any public comments on the motion there being none we will proceed to a vote all those in favor signify by saying aye oppose? motion carries. >> now we are onto regular business and without objection would like to move item 15 to the budget of our next hearing so we take up the budget and the vote at the same time if that is okay with everyone. >> okay item number ten. item ten approved? is there something that we should discuss that we have to think about before the next meeting in terms of budget? i think it's pretty self explaintory are there issues that we need to discuss? >> very quickly todd ritchie cfo and the prompt is complete and extensive if you review the materials that you already have for the public and it's also available on the website so we can have a full discussion next

time and i'm available to questions at anytime. >> all right and do we have a time estimate for what that combined presentation is likely to involve in. the one today before you we have summarized to about 30 minutes it's a high level discussion ways it's our mid cycle review next time will be a little bit longer because we want to up date you on the the ba. t k c a. >> okay thank you very much item number ten to approve the subject party a wearward agreement cs-245 and execute professional services agreement grid for an amount not to exceed one million 500,000 within a duration of five years.

>> assistant general manager for water this is a straight forward item pending compliance for necro, compliance and i'm happy to answer if he questions about it. >> is there a motion? , seconded any public comments all those in favor signify by saying i didn't oppose? motion carries item lessen. >> item 11 scheduled and cost revision toss cal vera's dam replacement project: mislabonte, if we could please connect the computer i have a presentation. before we begin, i would like to introduce you to dan wade who's here with me dan

is the project for cal veras tonight and i feel fortunate to have him by my side through the challenges on the project so overt last six months, we have breed you multiple times on the discovery of an expecting geological condition on the prolong and we have also shared with you the magnitude of the cost and schedule impact of those deferring side conditions and what we are doing today is for the first time we are seeking your form rl approval on action needed to keep the prompt moving. >> that is one 17 million. one of the four and specifically, we are proposing four separate commission action: first, we are seek your approval for the adoption of seeka find gd in the a den double dumb one project e i r and improve

project modification associated with the disposal of additional material. we are also seek the approval of revision toss project schedule in budget that are highlighted here under item two and i'll elaborate on those more later on in my presentation. third, in order to keep the project moving, we need your approval from identifying the construction contract because the impacts on that contract are greater than the 10 percent of the original value of the contract than the original duration of the contract and finally, we need your approval for the reallocation of the one 15 million-dollar from the program management reserve and to the cal bar reticular

calaveras project. and so we have five% and this is highly specialized work but it's obviously a very large contract and so five% of a four-500 million-dollar contract is a lot of --. >> that includes the communication element of it as well. >> yeah it does include. so you have reached out to l v's. >> we certain have. all right. >> thank you. so before i get into the details of the project, i wanted to give you brief overview of where we stain program wide so overall now, we are about 72% complete with only five project remain engine preconstruction and hopefully this number will soon go down to four because of as of today's agenda, we have the award of the san antonio backup pipeline. although we have completed as indicated here 59 of thion project most of the very large project on the program are

still in construction also, i wanted to highlight the fact that the balance on our project management reserve as of today is 117 million. so, if we address schedule first, dealing with the deferring site condition encountered amid 2012, will delay completion of the calaveras project until 2018 this represent a 25 month delay and the good news however is that we are forecasting all other project to complete by mid 20 2016 which, is the currently approved program complex date however i want to highlight here on the slide some of the project that have the greatest scheduled risk in regard to the time line. the prompt here are listed in order of risk level with the project. greatest scheduled risk being listed first and so what we are

going to be doing is we are going to be looking at these scheduled within the next month or two to identify any potential for creating some additional float or take any actions that are needed to prevent any delayings on those project. >> so many of these are foreseen at the outset were they not. on those projects there has been some little challenges that were not anticipated and that i could messenger. >> the motion for approval says up to 117 million is that going to cover us well. >> it's going to cover us i was going to touch on cost later but it's a two-step process the one 17 will allow us to move forward and keep the project moving but we will need to seek additional approval from you in the next few muchs to complete the project. >> and so the language should say up to one one means it could go beyond that. i probably feel more

comfortable with the scheduled estimate at this point than the cots estimate because the 117 is based on an estimate that was done from our sim team and that is different than what the contract proposal is and so at this point we need to negotiate that difference that delta between the two and so i'm not sure at this time where we are going to land, you know? , all right. >> so this is the summary on cost here and you can see under the first bullet, that we are forecasting at this time based on our c m estimates and that being blackened beach that the additional construction cost total one $17 million however that does not include the need for the additional soft cost that will be required for the additional 25 months of work as well as the cost for the

additional mitigation in addition, to that, the project now is only 30% done so we will need to replenish our construction cost contingency. required so that we can keep the project moving while we are negotiating the change order with our contractor. now, since we are going to be removing all of the program management reserve balance, to be able to cover our construction costs here it's important for us to look at cost savings for any other additional cost increases relate the to calaveras and other project and here we have four areas where we are focusing ton get these cost saves we have realized low bids on a few project with recent awards for example there is a

project the seismic upgade of pipeline three and four where i know for a fact we have $20.000000 in save lings and we are looking at other project closed out repeatedly the springs bypass tunnel we have $4.2 million in savings there and we are looking at project where we have large remaining contingency where our relative level is low bay tunnel is there is a lot of contingency left and we should pull some of that contingency money and reallocate it to other project and finally we are under taig take a massive internal review of all of our soft cost to railed additional savings and i personally reviewed our resource allocation and identified four $.7 million in savings and we will do the same at the regional and project level. so i wanted to in closing give you an idea of what our next steps are. if you do approve

todayth i knowa we will seek approval for the transfer of money from the management reserve to the prompt from the finance committee. we are once we have secured those funds we will issue a union lateral change order to the to allow the work to continue and in the mean time we will continue to negotiate a final change or the on the record with the contractor and we are hoping that this can be englished by the enof neb and and i mentioned to you once we are done with the negotiations we will see where we stand on the cost of the cal cal calaveras and also to comply with the requirements of the california water code issue a notice of change report to the state following your approval of any changes to the projects.

>> what is the total cost savings that you are projecting? it's hard at this point because i have not done my assessment but on top of my head based on a cursory review i'm approaching the $60 million. but, you know, i do not want to slidfy that until we have gone through our entire review. >> and of course, that savings would be attached to the 117 million, correct? yeah what we are doing now is using the one 17 to cover all of the hard costs but i need to come back with the additional funding needs and so what i need do now is identify all of those savings and move them to the program management reserve so that the money is available for any future changes. >> any other questions for ms. labonte? mr moran?